Income Tax Appellate Tribunal - Ahmedabad
Controller Of Estate Duty vs Vipin K. Nagori on 24 September, 1987
Equivalent citations: [1988]24ITD51(AHD)
ORDER
P.S. Dhillon, Judicial Member
1. The Revenue has made this appeal against the order dated 24-6-1983 of Shri K.S. Rao, Controller of Estate Duty (Appeals)-VIII, Ahmedabad who allowed the appeal (statistical purpose) against the order dated 25-2-1982 of Shri R.B. Bhatt, Asstt. Controller of Estate Duty, Ahmedabad.
2. The relevant facts, in brief, are that the deceased Harigangaben K. Nagori died on 19-2-1977, who was the widow, being her husband died on 20-2-1971. The family of the deceased consisted of her husband, two sons and a daughter in the year 1971 and prior to the date 20-2-1971 on which day her husband died. Her husband before his death made a will dated 21-4-1969 vide which he devolved his interest in the HUF property which was to devolve on the HUF itself, for his two sons and his wife,
3. In view of these facts, it was claimed and contended before the Asstt. Controller of Estate Duty that the deceased (widow) was not owner of any property and therefore, no property passes on her death, which is to be subjected to estate-duty. Reliance was placed on the decision in the case of CED v. Smt. Anari Devi Halwasiya AIR 1972 All. 179. The Asstt. Controller of Estate Duty did not accept the claim of the AP and thereby rejected its contention referred to above relying on Section 3(2) of the Hindu Women's Right to Property Act, 1937 and Hindu Succession Act, 1956 holding therein as under :
In this connection it would be seen that Under Section 3(2) of the Hindu Women's Right to Property Act, 1937, the widow of a member of a Hindu Undivided Family is put in the place of her husband and her husband's interest is the joint family property, though indefinite would vest immediately upon his death in the widow. The widow who acquired the interest of her deceased husband Under Section 3(2) of the Hindu Women's Right to Property Act, 1937 and who was possessed of the said interest on the coming into force of the Hindu Succession Act, 1956 becomes the absolute owner of the estate by option of Section 14 of the said Act and thus she would have all the rights of a full owner to possess, manage and enjoy exclusively and of disposal either by, ,any Act, inter vivo or by will the said estate. On her death intestate, her interest in the family properties would pass and devolve by succession on her heirs to that extent it would be required to be included in the estate liable to pay duty under the Estate Duty Act.
In any case, the widow having become the absolute owner of the share which she inherited from her husband, would be competent to dispose it of, it being an incident of full ownership, and therefore, her interest would be deemed to be property passing on her death Under Section 6 of the E.D. Act.
The widow of a member of a Hindu Undivided Family is put in the place of her husband and the husband's interest in the HUF property though indefinite, would vest immediately upon his death in his widow. The widow who acquired the interest of her deceased husband Under Section 3(2) of the Hindu Women's Right to Property Act, 1937 and who was possessed of the said interest on the coming into force of the Hindu Succession Act, 1956, become the absolute owner of the estate by operation of Section 14 of the later Act and thus she would have all the rights of a full owner and would be competent to dispose it of which is an incident of full ownership. Therefore, her interest would be deemed to be property passing on her death Under Section 5 or Section 6 of the E.D. Act. The right which has been given to a Hindu woman under the 1937 Act is also in lieu of partition, and therefore, if a notional partition were to take place shortly after her husband's death she would be entitled to the share.
4. From the above discussion, it would be seen that under the provisions of Section 3(2) of the Hindu Women's Right to Property Act, one half of her undivided interest of her deceased husband in the HUF property passed to her as widow's estate. The provisions of Section 14(1) of the Hindu Succession Act, 1956 are also applicable, and so the share which she acquired, is acquired as absolute owner and that share vested in her as full owner which passes on her death as property passing liable to be assessed Under Section 5 or Section 6 of the B.D. Act. These above views are supported by Gujarat High Court decision in the cases of Suketu Jayantilal Shah v. CED [1975] 100 ITR 439, Go swami Vrajraiji Ranchhodlalji Maharaj v. CED [1978] 112 ITR 851 and Sarabhai Tribhovandas v. CED [1981] 130 ITR 326. . ,
5. Under the circumstances f share of the HUF estate which the deceased lady inherited from her husband, is deemed to pass under the E.D. Act.
6. In appeal, the CED (Appeals) in allowing the appeal held that the female members of a joint family have no interest in the properties of the HUF and it is only when there is an actual partition that they would get a share in the said property, that as there is no pre-existing right over the joint family property, the question of her interest in the joint estate passing on her death does not arise, that further she is also not a coparcener and there is also no cesser of any interest in the family property, that the cases relied upon by the Asstt. Controller of Estate Duty are not applicable to the facts of the case as in all these cases, the husband expired before the Hindu Succession Act, 1956 came into force, that the provision of Hindu Women's Right to Property Act, 1937 will not be applicable as in the case the death of the deceased husband took place in 1971, she could not be construed to have become absolute owner of the undivided interest, of her deceased husband, in the HUF property. Reliance was placed on the decision of the Allahabad High Court in the case of Smt. Anari Devi Halwasiya (supra) that under the Hindu law, a female did not have any interest in the joint family property and further she cannot claim her share nor can she demand a partition to determine her share in the joint family property,- it cannot be said that a female member of the joint family has any vested right over the property belonging to HUF, that in other words, though the mother is entitled to a share when sons divide the family estate between themselves, she cannot be recognized as the owner until the division is actually made, she having no pre-existing right in the estate except a right to maintenance. Reliance is also placed in the case of CED v. Estate of Late Smt. K. Narasamma [1980] 125 ITR 196 (AP).
Thus, on the aforesaid reasons, he held that on the death of the deceased, no property passes which is the subject matter of Estate Duty Act. He further held that assuming otherwise that the deceased's interest in the HUF which is liable to duty, then only l/3rd of the joint family property should be charged to duty. However, in deciding the rate at which the duty is to be charged, he held that as the deceased's interest, even assuming that it is liable to duty, cannot be considered as a coparcenary interest, she not being a coparcener, there is no question of invoking the provisions of Section 34(1)(c) of the Act. Assuming otherwise, the deceased's interest in the joint family property is not liable to be included in the principal value of the estate, inclusion of the value of interest of the lineal descendants for rate purpose will not be justified, as it is only when the coparcenary interest is charged to duty that the provisions of the Act providing for aggregation can be invoked. Thus, on these reasons he directed the Asstt. Controller of Estate Duty to re-compute the estate duty liability after revising the order of assessment on the lines indicated and mentioned in his order.
7. The Revenue being aggrieved with the order of the Controller of Estate Duty (Appeals) has preferred this appeal. In supporting the appeal, the learned Departmental Representative Shri Jani contends that the CED(A) erred in holding that interest of the deceased in HUF did not pass on death and therefore, he should have confirmed the assessment order on the issue. Reliance is placed on Hindu Succession Act, 1956 in particular Section 6, Section 14 and Schedule I contending therein that on the death of the husband of the widow, there is deemed partition of the HUF of which the husband of the widow is coparcener and the widow and daughter or daughters are members, and therefore, the widow shall have the share as legal heir to her deceased husband under the Hindu Succession Act and in accordance with the Schedule therein, where the widow is Class-I heir under Schedule I attached to the Hindu Succession Act; the wife is the member of the HUF of husband and is having pre-existing right of maintenance even prior to the coming into force of Hindu Succession Act, 1956. Thus, her position prior to Hindu Succession Act was that of the member of the HUF and not its coparcener but she was the member of the HUF entitled to maintenance and hence was having pre-existing right of which she has become full owner on the commencement of the Hindu Succession Act, 1956. Thus with the coming into force of Hindu Succession Act in the year 1956, the position of the female member (the mother, widow and daughter) is not the same, rather she is as the sons are on the death of the coparcener, the husband and father. Reliance is placed in the case of Gurupad Khandappa Magdum v. Hirabai Khandappa Magdum [1981] 129 ITR 440 (SC) also. On the other hand, Shri Shah, the learned counsel for the assessee, contends that Hindu Women's Right to Property Act, 1937 does not help as the same is repealed by the Hindu Succession Act, 1956, that the Hindu Succession Act does not make the widow a coparcener, and therefore, she cannot get the property of the HUF's partitioned and as such question does not arise to pass any right or property on her death for the purpose of Estate Duty Act. Further, the Hindu Succession Act provides to dispose of the property by male Hindu by way of will and in this case, the husband of the deceased (widow) has made a will by which the property was disposed of on the HUF to which he belonged as coparcener and the widow was there as its member merely. Therefore, Section 14 of the Hindu Succession Act is not applicable to this case. Reliance is placed on the decision of the Allahabad High Court in Smt. Anari Devi Halwasiya's case (supra). He distinguished the cases relied upon by the learned Departmental Representative and the Asstt. Controller of Estate Duty mentioned above and relied on the order of the Controller of Estate Duty (Appeals).
8. We have heard the rival contentions at length and gone through the record before us. The wide issue for our determination is the status of the Hindu female in the HUF and the specific or limited issue is the status of the Hindu widow in the HUF and her right on the death of her husband, who was coparcener in the coparcenary.
8.1 The contention of the learned counsel for the assessee is that the Hindu female was having no right in the caparcenary or in the HUF of her husband. She was merely entitled to maintenance and in lieu of it she cannot get the partition of the coparcenary assets or properties or have any charge for it on its assets or the HUF property of her husband. Her position or status is not changed even up to date of the coming into existence or in force of the Hindu Women's Right to Property Act, 1937 or Hindu Succession Act, 1956. Therefore, no property at all passes on her death for the purpose of Estate Duty Act, 1953. The learned counsel further contended that the Hindu female or woman is in the HUF or Hindu coparcenary even to-day as she was living and treated in the Hindu Social System created by Manu and his laws and also maintained and governed by the Hindu Laws.
Thus, in this situation of the matter, we have to look to the Hindu Social System and the laws governing it, to determine the right of Hindu female and widow on the death of her husband coparcener in the Hindu coparcenary or HUF.
9. Manu is the law giver to govern and control the Indian society and in particular the Hindu way of life in his days and for thousand years thereafter. He gave four Varnas to the Hindu society or community in India - Brahman, Kashitreya, Vaish and Shudra. Every Indian knows that the rights and duties of each Varna were different from and for each other. On account of this, a situation came in Indian Hindu Society or the Hindu community that the fourth Varna had no right, rather obligations and duties, resulting in, to be known as untouchable, who are to-day known as Scheduled Castes. Thus, l/4th of the Hindu community became untouchables, whose shadows were avoided by other Varnas and they were worst than the animals, as everybody is aware that Cows, Goats, Snakes, Lions, etc. were worshipped in their temples and while they were not allowed to enter therein. The condition of the Hindu female was not better than that of fourth Varna. The untouchables were allowed to have their own God or Goddess and worship him or them, while she was having no God or the Goddess; except her own husband. So, she was the property of her husband to be treated just as a beast of burden or to be his slave for all purposes.
9.1 However, it is known fact that if she is there in the house of Hindu male obeying and serving her husband, then she is to be maintained. Thus, under the Manu Laws, the Hindu female was living in the family or joint family observing the Varnas and her husband as God where the head of the family was supreme and was known as karta and the family as Hindu Joint Family or HUF.
9.2 Thus, in this family, the Hindu female - wife, widow, daughter, daughter-in-law were there to be maintained as its members if they served and act as the laws of Manu or Hindu Law and customs say to them to act and do, then and then only they-were entitled to be kept and maintained in the family.
10. When this was the law and customs of Hindu society, then naturally Hindu female was taken as inferior to the Hindu male. This joint Hindu family on account of this concept took the shape of Hindu coparcenary, where the males were coparceners or co-owners or co-sharers of its assets ; since their birth or conception in the womb, entitle to have share in the properties of the coparcenary or HUF. The head of the family was its karta and Supreme Manager, who can dispose of the property for legal necessity or for the benefit of the coparceners, 10.1 Thus, the Hindu coparcenary is a limited term and is there if the husband and wife are in the family on the performance of Hindu marriage under the Hindu Law, customs, ceremonies and rites resulting in the birth of the son. If the son is not there, then there is no Hindu coparcenary ; though in their family daughter or daughters are there. So, when to the married Hindu male (husband) and Hindu female (wife) there is no son and there is daughter or daughters then the family is HUF or Joint Family consisting of husband, wife and daughter or daughters. Therefore, the HUF is having very wide meaning than that of Hindu coparcenary ; while family and joint family or HUF are having separate concept. The family of the Hindu male is there if he is married to a Hindu female in accordance with Hindu ceremonies and rites under the Hindu Laws of marriage. In other words, a single person male or female does not constitute the Hindu family. The Joint Hindu Family or HUF is there if there is female issue and it becomes Hindu coparcenary if there is male issue, the son. Reliance can be placed on the cases in C. Krishna Prasad v. CIT [1974] 97 ITR 493 (SO) and CED v. Alladi Kuppusivamy [1977] 108 ITR 439 (SC).
10.2 In the HUF or Hindu coparcenary, the Hindu female was its member, while Hindu males were the coparceners or co-owners or co-sharers, who were having the right of partition of the Hindu coparcenary and Hindu HUF. The Hindu female was there as its member, having merely a right to be maintained if she performs the duties ; as we have mentioned above. Thus she was not having the right of partition if neglected or turned out.
10.3 Therefore, from the aforesaid facts, there is no doubt in our mind that the status or position of the Hindu female in the Hindu Society was worst than the fourth Varna of the Hindu Society -the Sudra and she was there just as a slave or servant to be maintained and kept in lieu of services to the master, the coparceners.
11. This was her fate under the Hindu Society and Manu Laws or Hindu Laws. It is she who created coparcenary and its coparceners, nursed and looked after them ; but in reward to her, she was taken in it to create or produce and bring up the coparceners of the Hindu coparcenary. Her condition on account of such position and thinking of the Hindu male, Hindu society and coparceners of the Hindu coparcenary, became so bad that all types of ceremonies, ordeals came into existence in the Hindu community or society namely that of Sati and Devdasi and crossing into fire to prove her purity.
11.1 However, out of the Hindu Society and coparceners of coparcenary, a few started thinking that treatment to the Hindu female by the Hindu male is the blot on the society and their faces. Therefore, they started to reform Hindu Society and its laws, customs and ceremonies. The result of it was that after a long period, Hindu Society and its reformers and thinkers like Ram Mohan Roy came to the conclusion that Hindu female or woman is to be treated if not equal to the male Hindu then at least better. Thus, during the days of British Rule or Raj, these reformers pleaded for reforms in her status and therefore, laws were made in her favour and there came Hindu Women's Right to Property Act, 1937. The Hindu Women's Right to Property Act, 1937 gave an interest or right in the HUF property which became charge or overriding title on the HUP properties or coparcenary property and also the right to get such property-partition, as the Hindu male (coparcener) can get it. With the passage of time it was recognized and pronounced by the court that if she is maltreated or not properly maintained, then she can get such property partitioned. On account of this, she became safe and secured as she had get vested right in the coparcenary property ; though she was there as its member but her right and interest became an encumbrance or overriding title on the coparcenary property or its assets. Accordingly, the Hindu Society and Hindu Law accepted it and the allowance of maintenance was recognized by the laws of Society as her vested right in the coparcenary and HUF properties. Hence she was entitled to have it through the established procedure of law which allowed it in partitioning of the coparcenary property on special facts and circumstances and equal to coparcener, as her share in lieu of her interest, right and maintenance allowance.
11.2 Thus, from the aforesaid facts, it is manifest that she was in the Hindu society not at all equivalent to the Hindu male ; since its existence or the day of Manu and to that of Hindu Women's Right to Property Act, 1937.
12. Realising this, the leaders of India (Members of Parliament) under the leadership of late Prime Minister Pandit Jawaharlal Nehru thought to bring the Hindu female equal to Hindu male on attaining and dawn on Independence ; where the system of justice and laws were prescribed and made under the Constitution of India. The Chapter on fundamental rights in the Constitution of India says that there should be no discrimination amongst citizens of India on account of sex and they are equal before law. Accordingly, the Hindu Code Bill was framed by the father of the Constitution - Dr. Babasaheb Ambedkar, who was the Hon'ble Law Minister in the Cabinet of Pandit Jawaharlal Nehru. The Hindu Code Bill was not accepted and opposed, hence was not enacted. Therefore a via media was found in getting it into parts and one of these parts is Hindu Succession Act, 1956. Therefore, we have to see the position of Hindu female in the Hindu Succession Act, 1956. For this purpose, we have to look to it and in particular to its Sections 6, 8, the Schedule, Class-I and Class-II and Sections 9 & 14.
Section 6 When a male Hindu dies after the commencement of this Act, having at the time of his death an interest in a Mitakshara coparcenary property, his interest in the property shall devolve by survivorship upon the surviving members of the coparcenary and not in accordance with this Act.
Provided that, if the deceased had left him surviving a female relative specified in Class-I of the Schedule or a male relative, specified in that class who claims, though such female relative, the interest of the deceased in the Mitakshara coparcenary property shall devolve by testamentary or intestate succession, as the case may be, under this Act and not by survivorship.
Section 8 The property of a male Hindu dying intestate shall devolve according to the provisions of this Chapter :
(a) firstly, upon the heirs, being the relatives specified in Class I of the Schedule ;
(b) secondly, if there is no heir of Class I, then upon the heirs, being the relatives specified in Class II of the Schedule ;
(c) thirdly, if there is no heir of any of the two classes, then upon the agnates of the deceased ; and
(d) lastly, if there is no agnate, then upon the cognates of the deceased.
The Schedule (see Section 8) Heirs in Class I and Class II Class I Son ; daughter ; widow ; mother ; son of a predeceased son ; daughter of a predeceased son ; son of a predeceased daughter ; daughter of a predeceased daughter ; widow of a predeceased son ; son of a predeceased son of a predeceased son ; daughter of a predeceased son of a predeceased son ; widow of a predeceased son of a predeceased son, Class II I. Father II. (1) Son's daughter's son, (2) son's daughter's daughter, (3) brother, (4) sister.
III. (1) Daughter's son's son, (2) daughter's son's daughter, (3) daughter's daughter's son, (4) daughter's daughter's daughter.
IV. (1) Brother's son, (2) sister's son, ;(3) brother's daughter, (4) sister's daughter.
V. Father's father ; father's mother.
VI. Father's widow : brother's widow.
VII. Father's brother ; father's sister.
VIII. Mother's father ; mother's mother.
IX. Mother's brother ; mother's sister.
Section 9 Among the heirs specified in the Schedule, those in Clause I shall take simultaneously and to the exclusion of all other heirs ; those in the first entry in Class II shall be preferred to those in the second entry ; those in the second entry shall be preferred to those in the third entry ; and so on in succession.
Section 14 (1) Any property possessed by a female Hindu, whether acquired before or after the commencement of this Act, shall be held by her as full owner thereof and. not as a limited owner.
Explanation : In this sub-section, 'Property' includes both movable and immovable property acquired by a female Hindu by inheritance or devise, or at a partition, or in lieu of maintenance or arrears of maintenance, or by gift from any person, whether a relative or not, before, at or after her marriage, or by her own skill or exertion, or by purchase or by prescription, or in any other manner whatsoever, and also any such property held by her as stridhana immediately before the commencement of this Act.
(2) Nothing contained in Sub-section (1) shall apply to any property acquired by way of gift or under a will or any other instrument or under a decree or order of a civil court or under an award where the terms of the gift, will or other instrument or the decree, order or award prescribe a restricted estate in such property.
13. From the aforesaid sections, it is clear that the Hindu female is brought equal to the Hindu male though reasonable restrictions or limitations are still there namely, the Hindu female during the lifetime of such coparceners having interest in the coparcenary property cannot ask for its partition though the Hindu male who is coparcener therein can claim it at any time. However, she will be entitled to her-own share and that of the coparcener on his death in the coparcenary property of her father and husband. The proviso to Explanation 1 of Section 6 says that on the death of coparcener, there will be deemed partitioned which means that on the death of the coparcener, there will be partition of the coparcenary and also that of the interest of the deceased coparcener simultaneously immediately on the death of such coparcener as if it had happened in the lifetime of such coparceners, among the members of the coparcenaries and heirs of the deaceased, which are there in the Scheduled Class-I & Class-II stated above.
Thus, from Section 6, there is no doubt in our mind that the Hindu female in the coparcenary is co-sharer or coparcener in the coparcenary and in the interest of the Hindu coparcener as heir who is her relative namely father, husband, brother etc. and shall share in such interest on his death in accordance with the Schedules I & II referred to above.
14. When this is the position under the Hindu Succession Act, 1956, then she is coparcener in the coparcenary and heir to the share or interest of the deceased coparcener related to her as mentioned in Schedules I & II (supra). Therefore, on the commencement of Hindu Succession Act, 1956 her status is that of the coparcener and her interest in the coparcenary or HUF is increased both in quality and quantity. The disposal of the interest of the share by the deceased coparcener by will is meaningless in view of the deemed partition of the coparcenary and this partition is there as if it was caused during his lifetime or immediately before his death. Therefore, she on account of it, has become full owner of this share in the coparcenary as member and as heir in the interest of the deceased coparcener. And therefore has vested in her making her its full owner. Therefore, it cannot be taken away by the will of the deceased coparcener ; since the will is to be given effect to after the death of the deceased coparcener and it cannot be given effect to in view of the fact that after the death, the deceased was having no property in the coparcenary being vested in the heirs of the deceased, on account of deemed partition of the coparcenary during the life of the deceased coparcener and such partition is on account of this fiction as if it was there during the lifetime of the deceased, hence the deceased has nothing to dispose of bequeath by way of will. Therefore, there is no substance in the contention of the learned counsel for the assessee, when he says that the deceased coparcener has devolved his share or interest in the coparcenary by way of will as deemed partition which is not actual partition. Further Section 14 has made her full .owner of the interest or right provided to her under Section 3 of Hindu Women's Right to Property Act, 1937 and right to maintenance under the Old Hindu Law. Therefore, it cannot be accepted that she was not having any pre-existing right or she was not at all a co-owner or shareholder in the HUF or coparcenary property. Thus, the Hindu female is coparcener in Hindu coparcenary or HUF having the same rights which were there of the coparceners before the commencement of Hindu Succession Act, 1956 on account of its sections referred to above and it is to be there on account of partition provided Under Section 171 of the Income-tax Act, 1961 vide which member of the HUF can apply and ask for partition to the ITO. The ancestral property and coparcenary property or HUF property cannot be disposed of by a will or any other device debarring the Hindu female to have her share in it as we have mentioned above. Only the self-acquired property by the Hindu male if at all can be disposed of at the most, by such device namely the will etc. Furthermore, it cannot be held on account of the plea that on the commencement of the Hindu Succession Act, 1956 the Hindu Women's Right to Property Act, 1937 is repealed and, therefore, on the commencement of the Hindu Succession Act, there was no right vested in her or there was no pre-existing right and as such Section 14 is of no help to her. The reason is that no doubt that the Hindu Women's Right to Property Act, 1937 is repealed on the commencement of Hindu Succession Act, 1956 but the right which was given to her under the Hindu Women's Right to Property Act, 1937 has not been taken away by the Hindu Succession Act, 1956 ; rather the same is extended. Reliance can be placed on Section 6 of General Clauses Act, 1887. Therefore, on the commencement of Hindu Succession Act, 1956 the right which was there with the Hindu female or woman under the Hindu Women's Right to Property Act, 1937 is there and is extended vide Section 14 of the Hindu Succession Act and this right (vested right or pre-existing right) cannot be taken away either by will or by Section 30 of the Hindu Succession Act.
We are supported in our aforesaid view by the decision of their Lordships of the Hon'ble Supreme Court in the case of Gurupad Khandappa Magdum (supra) where their Lordships held as tinder :
In order to ascertain the share of the heirs in the property of a deceased coparcener of an HUF it is necessary, in the very nature of things,, and as the very first step, to ascertain the share of the deceased in the coparcenary property. For, by doing that alone, can one determine the extent of the heir's share. Explanation 1 to Section 6 of the Hindu Succession Act, 1956, resorts to the simple expedient, undoubtedly fictional, that the interest of a Hindu Mitakshara coparcener 'shall be deemed to be' the share in the property that would have been allotted to him if a partition of that property had taken place immediately before his death. What is therefore, required to be assumed is that a partition had in fact taken place between me decease and his coparceners immediately before his detail. That assumption, once made, is irrevocable. In other words, the assumption having been made once for the purpose of ascertaining the share of the deceased in the coparcenary property, one cannot go back on that assumption and ascertain the share of the heirs without reference to it. The assumption which the statute requires to be made, that a partition had in fact taken place, must permeate the entire process of ascertainment of the ultimate share of the heirs, though all its stages. To make the assumption at the initial stage for the limited purpose of ascertaining the share of the deceased and then to ignore it for calculating the quantum of the share of the heirs is truly to permit one's imagination to boggle. All the consequences which flow from a real partition have to be logically worked out, which means that the share of the heirs must be ascertained on the basis that they had separated from one another and had received a share in the partition which had taken place during the lifetime of the deceased. The allotment of this share is not a processual step devised merely for the purpose of working out some other conclusion. It has to be treated and accepted, as a concrete reality, something that cannot be recalled, just as a share allotted to a coparcener in an actual partition cannot generally be recalled. The inevitable corollary of this position is that the heir will get his or her share in the interest which the deceased had in the coparcenary property at the time of his death, in addition to the share which he or she received or must be deemed to have received in the notional partition. This interpretation of the provisions of Section 6 of the Act will further the legislative intent in regard to the enlargement of the share of female heirs qualitatively as well as quantitatively.
15. The word 'possessed' in Section 14 referred to above is used in the broad sense and in its widest connotation and as pointed out by the Supreme Court in Gummalapura Taggina Matada Kotturuswami v. Setra Veeravva [1959] Suppl. 1 SCR 968. In this decision, their Lordships of the Supreme Court interpreted the word 'possessed' means "the state of owning or having in one's hand or power." It need not be actual or personal occupation of any property by the female but may be possession in law. Thus, it may be actual or constructive or in any form recognized by law. Therefore, we hold that when the right to maintenance is there for the Hindu female in the HUP property or in the coparcenary property, then she has become full owner of it or she is having pre-existing right in the coparcenary property on coming into force the Hindu Succession Act and therefore, has come equivalent to male Hindu ; though she is not having the right to get the HUF property or Hindu coparcenary partitioned. But it does not mean that she has no right to safeguard her interest in the coparcenary as we have mentioned above by taking action under the established procedure of law prevailing in our country and therefore, if there is partition of the Hindu coparcenary property by its coparceners, then she can claim her share equivalent to the coparceners if she is its member and comes in their row as is created, by Schedules I & II under the Hindu Succession Act.
Reliance can also be placed on the decision of their Lordships of the Hon'ble Supreme Court in the case of Kalloomal Tapeswari Prasad (HUF) v. CIT [1982] 133 ITR 690, 702 "may be as regards persons who are members of the family or as regards to properties which belong to it". Thus, from the aforesaid finding of their Lordships, it is cleax to us that the effect of partition of the HUP, whether by the action of the coparceners or by the operation of the law, is the same, namely, that the properties of the erstwhile HUF come thereafter to be held by the various legal heirs as tenants-in-common. In order to bring about the disruption of the HUF, under the Hindu Law, as has-been emphasised by their Lordships of the Supreme Court in Kalloomal Tapeswari Prasad (HUF)'s case (supra), it is not at all necessary that the properties, in question, must be divided by metes and bounds before a partition of the family can be said to have been effected. Further, as we have already mentioned, that Section 171 of the Income-tax Act, 1961, provides for partition of the HUF properties or assets if so demanded and asked for by its members-the female.
Thus, when this is so, we do not see any substance in the contentions, of the learned counsel for the assessee referred to above and therefore we reject these and accept those of the learned Departmental Representative being well-founded and supported by the aforesaid decisions of the Hon'ble Supreme Court, and vide Section 171 of the Income-tax Act, 1961. The cases relied upon by the learned counsel for the assessee are of no help in view of the decision of the Hon'ble Supreme Court referred to above. The decision of the Allahabad High Court (supra) cannot be acted upon or followed as we have followed the decision of the Hon'ble Supreme Court which is the final authority of law of the land on the issue and is contrary to the decisions of their Lordships of Supreme Court (supra).
16. Now we come to the issue that whether the share is there of the Hindu female in the interest of the Hindu coparcener who before death has devolved it by will and thereby debarred the Hindu females, the widow and daughters to have it. This cannot be held valid devolution or disposition or transfer of movable or immovable property of the HUF by its coparcener of his interest in the coparcenary at the time of death or before the death, being contrary to the provision of law as we have already viewed vide which she has become full owner and co-owner having pre-existing right under Hindu Women's Right to Property Act, in the property of the HUF or Hindu coparcenary being the member in it and was entitled to maintenance under the old Hindu Law and, therefore, she is its absolute owner and co-owner or coparcener thereto as we have already mentioned above and as such she cannot be debarred from it by a device namely will. Therefore, we also reject the contention of the learned counsel for the asses-see that the deceased made a will vide which the property in respect of his interest in the Hindu coparcenary has gone to his HUF consisting of sons, daughter. Therefore she (widow) did not had any property on the death of her deceased husband and as such no property passed or passes on her death for the purpose of estate duty. Accordingly, we further hold that on the death of her husband, she become in equal share to the coparceners she is also entitled to have the share determinable as per the Schedule I appended to Hindu Succession Act in his interest in the coparcenary of HUF as mentioned above. Because the partition of the deceased coparcenary or HUF or succession simultaneously is thereon the death as if it has taken place during the lifetime. Hence, she became full owner de facto and de jure on the day of death of the deceased coparcener being the member of the coparcenary in which the deceased was coparcener, which had actually partitioned on account of deemed partition during his life Under Section 6. And, therefore, her share in the coparcenary is increased in quality and quantity and as such it cannot be taken away or transferred by any will or any other device made by the deceased during his life, to dispose it of ; since her share has been vested in her and she has become full-fledged owner of it as we have already stated above.
16.1 We have also mentioned above that her husband died on 20-2-1971 and the family consisted of the deceased, two sons and a daughter at the time of his death being an admitted position, therefore, she had l/4th share in the property or share of her husband in the HUF property or Hindu coparcenary. We have already mentioned that the self-acquired property can be disposed of by way of will and if such property has gone to the hotchpotch of HUF or to the Hindu coparcenary, then there is no question of self-acquired property by the Hindu male or coparcener and as such if the interest in the HUF or coparcenary property is disposed of by a will or agreement or any other device, then it cannot be held that the Hindu female is not entitled to the share in the interest of the deceased Hindu male or boparcener in the HUF or coparcenary. Accordingly, we hold that she had l/4th share in the HUF property and also share in the interest of her deceased husband in the HUF or coparcenary property. Since we have held that she was the full owner of it on the death of her husband and therefore, it passed and passes on her death and as such is the subject-matter of estate duty.
17. In view of the our above discussion and reasons thereto, we hold that the Hindu female who was the member of coparcenary or the HUF entitled under the old Hindu Law and Hindu Women's Right to Property Act to maintenance and vested rights in the HUP or Hindu coparcenary became full owner of such rights on the coming into force of Hindu Succession Act, 1956 and therefore, she is entitled to be treated as coparcener heir in equal with the coparcener on the death of the Hindu coparcener as she will get her share (assets) of coparcenary properties and also in the interest of the deceased coparcener husband or father and other relatives determinable in accordance with Schedules I & II of the Hindu Succession Act, 1956. In this case, her share in the interest of the deceased husband is l/4th and therefore, it passed or passes on her death and as such is the subject-matter of tax Under Section 5 & 6 of the Estate Duty Act, 1953. Accordingly, we set aside the impugned order and thereby modify that of the Assistant Controller of Estate Duty holding that her share is l/4th and not 1/2 for levy of estate duty under the Estate Duty Act, 1953. Hence, he is directed to re-determine the estate duty Under Section 5 & 6 of the Estate Duty Act, 1953 accordingly.
18. In the result, the appeal is partly allowed.
K.T. Thakore, Accountant Member
1. I have carefully gone through the detailed and elaborate order made by my learned brother. With utmost respect, for the reasons which I shall set hereinafter, I am unable to agree with the view taken by him. In order to appreciate the controversy I shall first set out the relevant facts.
Smt. Harigangaben expired on 19-2-1977 leaving behind two sons Jamnadas and Vipin and a daughter. Her husband Kanaiyalal had expired previously on 20-2-1971. Shri Kanaiyalal left a will dated 21-4-1969. Under the said will he bequeathed his undivided interest in all the properties of his HUP upon the smaller HUP consisting of his two sons Jamnadas, Vipin and his wife Harigangaben and he directed his executors to give his undivided interest to HUF of Kanaiyalal Harilal as an independent owner thereof. On death of Harigangaben the question arose before the AGED as to whether any interest of the deceased Harigangaben in the properties of HUF passed on her death. The Asstt. Controller took the view that Under Section 3(2) of the Hindu Women's right to Property Act, 1937, the widow of a member of a HUF is put in the place of her husband and her husband's interest in the joint family property would vest immediately upon his death in the widow. The widow has thus acquired a right of her deceased husband under the said provisions. This right had become an absolute right under the Hindu Succession Act (HSA) and thus by operation of Section 14 of HSA she had a right as full owner to possess, manage and enjoy exclusively the entire estate. Therefore on her death intestate her interest in the family property would pass and devolve by succession on her heirs and to that extent such property would be includible in the dutiable estate of the deceased. That apart according to the AGED the widow having become absolute owner of her share inherited from her husband she was competent to dispose of it as its full owner and as such such interest would be 'property' passing on death Under Section 6 of the E.D. Act. Thus placing reliance on the aforesaid provisions and as also on the decisions referred to in para 3 of his order the ACED held that half share of the HUF estate of the deceased inherited from her husband was includible in her hands as a property deemed to pass on death. He thus included a sum of Rs. 85,329, in the dutiable estate.
2. Being aggrieved the A.P. carried the matter in appeal before the CED(A). It was pointed out that Kanaiyalal by will left by him had willed his interest in the property to devolve on the HUF itself. Therefore there was no question of any interest devolving by succession. Therefore the deceased had no interest in the HUF estate as she was not a coparcener. She could made such a claim, only on partition among the coparceners. Since there was no partition of the family property till her death she had no interest in HUF property and therefore inclusion of the aforesaid amount in the dutiable estate of the deceased was not justified. In this connection reliance was placed on the decision in the case of Anari Devi Halwasiya (supra). He also referred to the decision of their Lordships of the Gujarat High Court in CIT v. Shantikumar Jagabhai [1976] 105 ITR 795. It was thus contended that the female members' right was a contingent right and not a vested interest in the joint family property and therefore the same did not pass on death of a female member of the family. It was next pointed out that the ACED had substantially replied on the provisions of HWRPA 1937. This Act had no application as it stood repealed by HSA of 1956. The decisions relied upon by the ACED related to pre-1956 Act and therefore those decisions have no application. In other words it was the contention of the At that the position had to be examined with reference to HSA 1956 and in view of Section 30 of HSA permitting a member of a HUF to will his share in the HUF property, the devolution of the entire estate of the HUP itself by a will did not create any interest in favour of the widow. The CED(A) examined the above position and observed at para 6 of his order as under :
To sum up, it is seen that the female members of a joint family have no interest in the properties of the HUF and it is only when there is an actual partition that they would get a share in the said property. As there is no pre-existing right over the joint family property, the question of her interest in the joint estate passing on her death does not arise. Further she is also not a coparcener and there is also no cesser of any interest in the family property. The Asstt. Controller's action is assessing the deceased's alleged interest in the HUF estate as part of the principal value of the dutiable estate cannot therefore be upheld. The addition made of Rs. 85,329 is accordingly deleted.
3. Being aggrieved the revenue has come up in appeal before us. The rival submissions placed by either side have been set out in the order of my learned brother and therefore I do not wish to dilate upon the same in detail.
4. In my view the reliance placed by the revenue on the decision of their Lordships of the Gujarat High Court in the case of Sukelu Jayantilal Shah (supra) is clearly misplaced. In that case it is true that it was held that Under Section 3(2) of the HWRP Act, 1937 widow of a member of a HUF is put in place of her husband and her husband's interest in the joint family property, though indefinite, would vest immediately upon his death in the widow. The widow who acquired the interest of her deceased husband Under Section 3(2) of the HWRP Act, 1937 and who was possessed of the said interest on coming into force of the HSA, 1956, became absolute owner of that estate by operation of Section 14 of the said Act and thus she would have all the rights of a full owner to possess, manage and enjoy exclusively and on disposal either by any Act inter vivo or by will the said estate. On her death intestate her interest in the joint family properties would pass and devolve by succession on her heirs and to that extent it would require to be included in the estate liable to pay duty under the E.D. Act. Now this decision though binding turns on its own facts which are not applicable in the present case. In that case one Jayantilal Shah, the father of the AP expired in 1944. He died in jointness with his wife, Subhadra, two sons and an unmarried daughter. Under Section 3(2) of HWRP Act 1937 on demise of said Jayantilal Shah his widow Subhadra acquired the said interest in the joint family properties which her husband had at the time of his death. The widow Subhadra died on 14th November, 1959 leaving behind her two sons and one unmarried daughter who along with her constituted a joint Hindu family as stated above. Subhadra had not claimed any partition of the joint family properties before her death nor there was any partition effected amongst the said members. The above facts would clearly show that provisions of Section 3(2) of HWRP Act, 1937 applied to Subhadra who became a widow before coming into force of H.S. Act, 1956 and it was in these circumstances the question of quality and the nature of her interest was examined and it was found that her limited interest became absolute interest on coming into force of H.S. Act which she was competent to dispose of as an absolute owner under provisions of Section 14 of the H.S. Act. The essential distinction between the facts of the above case and the case before us is that Harigangaben the deceased in the present case became widow in 1971 on death of her husband Kanaiyalal. Therefore her rights were not governed by provisions of Section 3(2) of HWRP Act but would be solely governed by the provisions of H.S. Act. Therefore in my view the provisions of Section 3(2) of HWRP Act has no application in the instant case. That apart the above case was one of intestate succession and testamentary succession.
5. Having understood this essential distinction in ' so far as the factual matter is concerned we now proceed to examine the facts of the present case which is solely governed by the relevant provisions of the H.S. Act. The provisions with which we are concerned are Sections 6 and 30 of the H.S. Act. The scope of these sections had come up for consideration before the Hon'ble Gujarat High Court in case of CWT v. Kantilal Manilal [1973] 90 ITR 289. At pages 292 and 293 it is stated thus :
But, the Hindu Succession Act, 1956 made a radical departure in the devolution of interest of a coparcener in coparcenary property on his death. There are two sections of the Act which speak on this subject : Section 6 and Section 30. Section 6 is very, material and since the determination of the question before us turns almost entirely on the true interpretation of that section, we may reproduce it in full. It reads, omitting portions immaterial:
6. When a male Hindu dies after the commencement of this Act, having at that time of his death an interest in a Mitakshara coparcenary property, his interest in the property shall devolve by survivorship upon the surviving members of the coparcenary and not in accordance with this Act:
Provided that, if the deceased had left him surviving a female relative specified in class I of the Schedule or a, male relative specified in that class who claims, through such female relative, the interest of the deceased in the coparcenary property shall devolve by testamentary or intestate succession, as the case may be, under this Act and not by survivorship.
Section 30 provides for testamentary succession. Prior to the enactment of the Hindu Succession Act, 1956 a coparcener was not entitled to dispose of by will his interest in the coparcenary property but now he can do so by reason of Section 30.
In the present case Kanaiyalal died leaving a will under which he had bequeathed his interest in the HUF to the HUF itself and therefore this is clearly a case governed by Section 30 of the H.S. Act. In this connection we may refer to the decision of the Hon'ble Gujarat High Court in case of Navnitlal Sakarlal v. CWT [1977] 106 ITR 512. In this case one Sakarlal Balabhai died leaving behind a will under which he inter alia bequeathed all his right, title and interest in his joint family movable and immovable properties in favour of his two grandsons Navnitlal Sakarlal and Nandkishore alias Shambhubhai Sakarlal. Dealing with the scope of Section 6 and Section 30 of the H.S. Act their Lordships have observed as follows : (pp. 520 & 521) Under the orthodox Hindu Law of testator could not have disposed of his interest in the properties of the Hindu undivided family by a will. However, the Hindu Succession Act, 1956, which came into force on and with effect from June 17, 1956, made a radical departure in this behalf and since Balabhai, the testator in the present case, died after the enactment of the said Act, succession to his estate would be governed by the provisions of the said Act. Now under Section 30 of the Hindu Succession Act, it is competent for a male Hindu to dispose of by will or other testamentary disposition his interest in the Mitakashara coparcenary property in accordance with the provisions of the Indian Succession Act, 1925, or any other law for the time being in force and applicable to Hindus. As we shall presently show, the devolution of interest in coparcenary properties in this case would be governed by the provisions of Section 6 of the Hindu Succession Act and reference may, therefore, be made to the provisions of the said section. The main part of the said section provides that when a male Hindu dies after the commencement of the Act, having a' the time of his death an interest in a Mitakshara coparcenary property, his interest in the said property shall devolve by survivorship upon the surviving members of the coparcenary and not in accordance with the Act. The proviso to the said section, however, carves out an exception and provides that if the deceased had left him surviving a female relative specified in class I of the Schedule or a male relative specified in that class, who claims through such famale relative, the interest of the deceased in the Mitakshara coparcenary property shall devolve by testamentary or intestate succession, as the case may be, under the Act and not by survivorship. As already stated, the testator in the present case left him surviving three daughters who fall within the class of female relatives specified in class I of the Schedule and, therefore, his interest in the coparcenary properties would devolve by testamentary succession under the Act since he had executed a will. The assessee and his brother, therefore, became entitled under the will to inherit the one-half share of the deceased in the coparcenary properties.
In this case the deceased had left a will. Secondly his case was governed by provisions of H.S. Act. Thirdly the deceased had left female relatives specified in clause I of the Schedule of the H.S. Act, and lastly by testamentary disposition the joint family property was bequeathed in favour of two grandsons stated above and therefore the interest in the coparcenary properties devolved by testamentary succession under the H.S. .Act due to execution of a will.
6. In my opinion therefore the above decision would squarely apply to the facts of the case before us. In the instant case since by testamentary disposition the deceased Kanaiyalal had bequeathed his coparcenary interest in favour of the HUF itself, by reason of testamentary succession Under Section 30 of the HA Act, his shares stood devolved on the HUF itself and unless there was partition or death of a coparcener in the new HUF to whom the share of the coparcenary was bequeathed deceased Harigangaben would not have right in the joint family properties. Therefore, I agree with the view taken by the CED(A) that no part of the HUF properties would form part of the estate of the deceased Harigangaben. As a consequence the inclusion of one half share in her hands from the HUF property was not justified either in law or on facts of the case.
7. In the view I have taken it is not considered necessary to determine the extent of her share in the said property as this question does not fall for consideration.
8. For the aforesaid reasons, I would dismiss this appeal.
ORDER UNDER SECTION 63(11) OF THE ESTATE DUTY ACT, 1958 As there is difference of opinion amongst both of the Members in this case and, therefore, we make reference to the worthy President of the Tribunal under Section 63(11) of the Estate Duty Act, 1958, for appointing Third Member to settle the difference of opinion among us. Hence, we frame the following questions for the determination of the Third Member :
1. Whether the property and rights obtained in the HUF or Hindu coparcenary by the Hindu women,-widow, wife and daughter under the provisions of Hindu Women's Rights to Property Act (XVIII of 1937 amended by XI of 1938) has been taken away from her on coming into existence of Hindu Succession Act, 1956 due to the repeal of the Hindu Women's Rights to Property Act, 1937 by it ; and if so whether the Hindu Succession Act, 1956 has decreased her status and diminished her rights in the HUF and hence what is the actual status of her in the Hindu coparcenary or HUF ?
2. Whether the Hindu woman has become an absolute owner of her existing right of maintenance etc. in the HUF and, therefore, she has attained the status of coparcener in it under Sections 14, 15 and Schedules I-II of the Hindu Succession Act, 1956 if not then what is the status of Hindu woman in the HUF or Hindu coparcenary ?
3. Whether the Hindu woman, widow, wife and daughter on account of deemed partition under Section 6 of the Hindu Succession Act, 1956, is saved from the mischief of devises : "Will", etc. made by her deceased husband and father etc. who was having coparcenary interest or interest in the coparcenary or HUF ; if so whether he is debarred to dissolve the share in the coparcenary or his interest in the HUF belonging to him, by making a Will, which is to be effected after the death ; while the deemed partition of the Hindu coparcenary or HUF took place in his own life Under Section 6 of the Hindu Succession Act, 1956 in which he - the deceased husband, was having share or interest as coparcener in the Hindu coparcenary or HUF ?
4. Whether the Hindu woman is merely a member in the HUF or Hindu coparcenary even on coming into existence of the Hindu Succession Act and whether competent to have division of the Hindu coparcenary or HUF like the coparcener on account of it, as well as under provisions of Section 171 of the Income-tax Act, 1961, as a member or coparcener ?
5. Whether on the facts and in the circumstances of the case, it can be held that Section 30 of the Hindu Succession Act is applicable and, therefore, the Will made by the deceased husband is there to dissolve the share or interest of the deceased husband in the Hindu coparcenary or HUF as coparcener and where she was also there, as its member and if not a coparcener on account of Hindu Women's Property Act (XVIII of 1937 amended by XI of 1938), Hindu Succession Act, 1956, and amended Section 171 of the Income-tax Act, 1961, and if so, then she (widow) was having no asset or immovable or movable property or valuable right to pass on her death ?
K.T. Thakore, Accountant Member In my opinion Under Section 63(11) of the B.D. Act the point of difference is required to be stated. The real point of difference in my opinion is "whether on facts and circumstances of the case the inclusion of half the share of the deceased in the HUF estate inherited from her husband was includible in her hands as a property passing or deemed to pass on her death, the sum being Rs. 85,329".
In my opinion the above comprehensive question would fairly cover the point of difference and I would therefore refer the above question for the opinion of the learned Third Member.
THIRD MEMBER ORDER Y. Upadhyaya, Vice President
1. The point of difference under Section 63(11) of the Estate Duty Act had been assigned to the Third Member by the Hon'ble President. It will be fair to state that the two Members have differently framed the point of reference to the Hon'ble President. Therefore, it would be necessary to formulate a common question arising out of the difference which could be answered by the Third Member. The Questions formulated by the Judicial Member are as follows :
1. Whether the property and rights obtained in the HUF or Hindu coparcenary by the Hindu woman, widow, wife and daughter under the provisions of Hindu Women's Rights to Property Act (XVIII of 1937 amended by XI of 1938) has been taken away from her on coming into existence of Hindu Succession Act, 1956 due to the repeal of the Hindu Women's Rights to Property Act, 1937 by. it; and if so whether the Hindu Succession Act, 1956 has decreased her status and diminished her rights in the HUF and hence what is the actual status of her in the Hindu coparcenary or HUF ?
2. Whether the Hindu woman has become an absolute owner of her existing right of maintenance etc. in the HUF and, therefore, she has attained the status of coparcener in it under Sections 14, 15 and Schedule I-II of the Hindu Succession Act, 1956 if not then what is the status of Hindu woman in the HUF or Hindu coparcenary ?
3. Whether the Hindu woman, widow, wife and daughter on account of deemed partition under Section 6 of the Hindu Succession Act, 1956, is saved from the mischief of devises : "Will" etc. made by her deceased husband and father etc. who was having coparcenary interest or interest in the coparcenary or HUF ; if so whether he is debarred to dissolve the share in the coparcenary or his interest in the HUF belonging to him, by making a Will, which is to be effected after the death ; while the deemed partition of the Hindu coparcenary or HUF took place in his own life Under Section 6 of the Hindu Succession Act, 1956 in which he-the deceased husband, was having share or interest as coparcener in the Hindu coparcenary or HUF ?
4. Whether the Hindu woman is merely a member in the HUF or Hindu coparcenary even on . coming into existence of the Hindu Succession Act and whether competent to have division of the Hindu coparcenary or HUF like the coparcener on account of it, as well as under provisions of Section 171 of the Income-tax Act, 1961, as a member or coparcener ?
5. Whether on the facts and in the circumstances of the case, it can be held that Section 30 of the Hindu Succession Act is applicable and, therefore- the Will made by the deceased husband is there to dissolve the share or interest of the deceased husband in the Hindu coparcenary or HUF as coparcener and where she was also there as its member and if not a coparcener on account of Hindu Women's Rights to Property Act (XVIII of 1937 amended by XI of 1938), Hindu Succession Act, 1956, and amended Section 171 of the Income-tax Act, 1961 and if so, then she (widow.) was having no asset or immovable or movable property or valuable right to pass on her death ?
The question formulated by the Accountant Member is as follows :
Whether on facts and circumstances of the case the inclusion of half the share of the deceased in the HUF estate inherited from her husband was includible in her hands as a property passing or deemed to pass on her death, the sum being Rs. 85,329 ?
2. After considering the facts and circumstances of the case and point of difference of the two Hon'ble Members, it appears that the question formulated by the Accountant Member will cover up the other questions formulated by the Judicial Member and, therefore, answer is to be given by the Third Member only of the question formulated by the Accountant Member.
3. The fact is that Smt. Harigangaben expired on 19-2-1977 leaving behind two sons, namely, Jamnadas and Vipin and a daughter. Her husband Kanaiyalal expired on 20-2-1971. Shri Kanaiyalal left a will dated 21-4-1969. By the said will he bequeathed his undivided interest in all the property of the HUF upon the smaller HUF consisting of his two sons, Jamnadas and Vipin and his wife Harigangaben and he directed his executors to give his undivided interest to the HUF of Kanaiyalal Harilal as an independent owner thereof. The Assistant Controller of Estate Duty, on the death of Smt. Harigangaben, indicated his intention to include the interest of the deceased in the property of the HUF which passed on her death. He took the view that under Section 3(2) of the Hindu Women's Right to Property Act, 1937, the widow of a member of the HUF is to be in the status of her husband and her husband's interest in the joint family property would vest immediately upon his death in the widow. He was of the opinion that the widow had thus acquired a right of her deceased husband under the said provisions and the right became absolute under the Hindu Succession Act, 1956. He also considered the provisions of Sections 6 and 14 of the Hindu Succession Act, determined the value of the deceased's interest at Rs. 85,329 and included the same in her taxable estate. The accountable person in appeal relied on Anari Devi Halwasiya's case (supra) and Shantikumar Jagabhai's case (supra). He also explained the various provisions of the Hindu Succession Act, 1956. The Appellate Controller accepted the view of the accountable person and deleted the inclusion of Rs. 85,329.
4. When the matter was argued before the Tribunal the Hon'ble Judicial Member, after considering the provisions of Section 3(2) of the Hindu Women's Right to Property Act, 1937, provisions of Hindu Succession Act, decisions in Gurupad Khandappa Magdum's case (supra), Sarabhai Tribhovandas' case (supra) and came to the conclusion that the Assistant Controller was correct in including the deceased's interest at Rs. 85,329.
5. The Hon'ble Accountant Member, on the other hand, on the facts and circumstances of the case, came to the conclusion that the provisions of Section 3(2) of the Hindu Women's Right to Property Act, 1937 was not applicable. He also was of the opinion that the provisions of Section 6 and Section 14 of the Hindu-Succession Act were not applicable on the facts of the case and he, relying on Smt. Anari Devi Halwasiya's case (supra), Shantikumar Jagabhai's case (supra), Kantilal Manual's case (supra) and Navnitlal Sakarlal's case (supra), came to the conclusion that the deceased had no right of partition. He was only eligible for her share on partition of the family and, therefore the inclusion was not proper.
6. The departmental representative, Mr. Khandelwal, very strongly supported the inclusion of the deceased's share in the taxable estate on the basis of the order of the Judicial Member. He further supplemented his argument placing reliance on Gurupad Khandappa Magdum's case (supra), Sarabhai Tribhovandas' case (supra), Suketu Jayantilal Shah's case (supra) and Alladi Kuppuswamy's case (supra). He indicated that the right available to the deceased was absolute under Section 3(2) of the Hindu Women's Right to Property Act, 1937 and the said right became absolute under the Hindu Succession Act, 1956. He further stated that a Hindu father or Kartha has no right to will and, therefore, the property given to the HUF through a will was invalid. He also indicated that the matter has been concluded by the Supreme Court in Gurupad Khandappa Magdum's case (supra) and, therefore, the amount included by the Assistant Controller was fair.
7. Shri Shah, the counsel of the accountable person, on the other hand, stated the facts and urged that Shri Kanaiyalal died in 1971. He left a will dated 21-4-1969. Hindu Succession Act came into force in 1956. The Hindu Women's Right to Property Act, 1937 was repealed by Hindu Succession Act, 1956. Therefore, on the death of Shri Kanaiyalal, which took place in 1971, the widow was not entitled to any right or interest in the property under the Hindu Women's Right to Property Act, 1937. He further indicated that even Sections 6 and 14 of the Hindu Succession Act were applicable only when a Hindu male died. Here the lady died on 19-2-1977 and, therefore, she was not having any right under the Hindu Succession Act. He further referred to Section 7 of the Estate Duty Act and stated that even Section 7 is not applicable when a female dies. The counsel indicated that a lady cannot be a coparcener and she cannot claim a partition in the family. He relied on Pushpa Devi v. CIT [1977] 109 ITR 730 (SO). It was the opinion of the counsel for the accountable person that a female can get her share when a partition takes place in the family. The counsel distinguished all the cases and further indicated that the Supreme Court decision in Gurupad Khandappa Magdum's case (supra) was decided on a particular fact which is not applicable in the case of the assessee and the assessee's case is assisted by the later decision of the Supreme Court in State of Maharashtra v. Narayan Rao Sham Rao Deshmukh AIR 1985 SC 716. He further indicated that the other decisions cited by the departmental representative are before the introduction of the Hindu Succession Act, 1956 and, therefore, they are not applicable. He accordingly justified that the inclusion of the deceased's interest in the taxable estate was not proper.
8. The only point for decision is whether on the death of Smt. Harigangaben on 19-2-1977 her interest in the HUF could have been included in her taxable estate. Her husband Shri Kanaiyalal, who was a member of the HUF expired on 20-2-1971. He left a will dated 21-4-1969. He, according to the said will, bequeathed his undivided interest in the property to the smaller HUF consisting of his two sons, wife and a daughter. His wife Smt. Harigangaben expired on 19-2-77. Therefore, according to the will and the facts, when Smt. Harigangaben expired on 19-2-77 she was only a member of the smaller HUF. The correct position, according to law, is that-after the death of her husband on 20-2-71 she did not acquire any right under the Hindu Women's Right to Property Act, 1937 which was repealed in 1956 by the Hindu Succession Act, 1956. Further Sections 6 & 14 of the Hindu Succession Act were not applicable. It is very clear from Section 6 of the Hindu Succession Act that it is related only to a male Hindu and it is not related to a female. It is equally correct that a female is not a coparcener and she does not have the right of partition. On the question that she is not a coparcener rightly the case has been stated in Pushpa Devi's case (supra). A Hindu female has her right of maintenance and takes her share provided there is a partition in the family. She cannot, by virtue of her right, claim petition in the family itself. Much had been stated about the decision in Gurupad Khandappa Magdum's case (supra). It has been rightly distinguished by the assessee's counsel. A male died in the said case and no will was left. On these facts the matter was decided by the Hon'ble Supreme Court. In the present case a female had died and her husband left a will, therefore, the said decision is not applicable on the facts of the present case. Assistance is available from the later decision of the Supreme Court in Narayan Rao Sham Rao Deshmukh's case (supra). Hayne's commentary on Hindu Law and Usage, 12th edition, is helpful in explaining the various provisions which has been considered on coming to this conclusion that the interest of the lady cannot be included on her death in the taxable estate because she was not a coparcener. She did not get any right before 1956. A will was left by her husband and according to the will she became only a member of the HUP and she was not a coparcener. She did not have right of partition. She only had a right of her maintenance and she was entitled for her share if partition took place in the family. The will of her husband neither has been challenged nor it could be challenged.
9. After considering the facts, the arguments and the various case laws of the respective parties, the question is answered as follows :-
On the facts and circumstances of the case the inclusion of half of the share of the deceased in the HUF estate inherited from her husband was not includible in her hands as a property passing or deemed to pass on her death.
The matter is referred back to the Division Bench for passing the final order according to the majority decision.